GE Capital has acquired the UK invoice
discounting and factoring arm of Crédit Agricole Leasing &
Factoring (CAL&F) for an undisclosed amount.
Crédit Agricole Commercial Finance UK,
formerly known as Eurofactor UK, is ranked ninth in the UK invoice
finance market and provided about £3bn of finance to UK companies
during 2010. It has 51 employees accross offices in London, Leeds
and Reading. Its turnover is €4.253bn.
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A statement by CAL&F said the sale is
consistent with the aim of French banking group Crédit Agricole to
focus on core geographies and services: “The sale
demonstrates a centring which illustrates the focus
growth approach of CAL&F internationally so as to
strengthen its leadership positions in synergy with the rest
of the Crédit Agricole Group.”
In the wake of the sovereign debt crisis, many
European banks have been scaling back some activities and focusing
on their core markets. GE Capital capitalised on this trend as
early as last year, when it picked up the French and German
components of Royal Bank of Scotland’s invoice finance
business.
The new acquisition will further enlarge GE
Capital’s UK commercial and corporate lending business, as well as
develop its strategic focus on providing finance to UK
SMEs.
A statement from the company said the
acquisition would complement last year’s European acquisitions to
cement GE’s position as a leading provider of accounts receivable
finance.
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By GlobalDataGE Capital lends more than £4bn in volume
terms to UK SMEs through its AR (accounts receivable) finance
business every year. The acquisition of Eurofactor UK will increase
the business’s lending to SMEs by more than 60% in volume
terms.
The Eurofactor deal happens amidst a recent
acquisition drive by GE Capital. The company has sought to
capitalise on opportunities created by the scaling bank by banks in
the UK and Europe on certain activities deemed to be non-core in
order to offset the impacts on the financial crisis and the new
accounting rules.
Richard Laxer, president and CEO of GE Capital
EMEA, said: “This acquisition is a great fit for our business,
building our UK presence at a time when access to finance has never
been so important. With SMEs contributing more than 65% of Europe’s
GDP, they are essential to driving economic growth and employment
in the region.
“This acquisition extends our presence in this
critical part of the economy and, at a time when many institutions
are retrenching, demonstrates our commitment to supporting European
SMEs with not just the capital they need but also solutions.”
“As part of GE, we deliver more than money. We
have deep industrial expertise, operational experience and
technical insights and share this knowledge with our customers,
helping them grow and win in the marketplace.”
GE Capital was recently in talks with RBS
about acquiring Lombard Vehicle Management, but talks ended last
month. RBS put the business up for sale in June as part of the 84%
state-owned bank’s disposal of non-core assets and GE Capital was
immediately identified as a likely bidder.
GE Capital was also reported as being in
contention for the acquisition of ING Car Lease, which was
purchased by BMW’s vehicle leasing company Alphabet, and also
linked to a bid for Masterlease in late 2010 which was bought by
Investec and Leasedrive.
A further non-core business, RBS Aviation
Capital, is
currently up for sale and GE Capital is widely reported to be
interested in the Dublin-based aircraft leasing business.
GE Capital declined to comment on the RBS
Aviation Capital sale.
A CAL&F spokesperson confirmed that no
other businesses are for sale.
janet.duchenne@vrlfinancialnews.com
